- (1.) THIS is a revision petition against the order of the District Judge, Kumaun, allowing the application of the Income -tax Officer, praying that the sum of Rs. 12,237 -13 -6 lying in deposit in the Government Treasury in respect of tax demands outstanding against the firm and the partners which far exceed the amount lying in deposit with the court.
(2.) A civil suit for rendition of accounts was filed in the court of the District Judge. A final decree was passed by the District Judge on the 30th November, 1955. Rs. 12,237 -13 -6 were lying in deposit in the court as a result of the sale of certain movable of the firm. It was held that each of the four partners of the firm was entitled to one -fourth share therein subject to the claim of the income -tax department and the sales tax department against the firm. It was further ordered that, inasmuch as the claims of the taxing departments far exceeded the deposit in court, no party to the suit shall be allowed to withdraw any part of the deposit till the claim of the taxing department is either withdrawd. or reduced Thereupon, the Income -tax Officer, A -Ward, Bareilly, by means of two letters, one dated 11th December, 1956, and the other dated 19th February, 1957, applied to the District Judge praying that the sum of Rs. 12,237 -13 -6 lying in deposit in the court be deposited in the Government Treasury towards the payment of income -tax dues against the parties to the suit. Notices were issued to all the parties to show cause why the prayer made by the Income -tax Officer be not granted. There was no objection from the judgment -debtor but the plaintiff -decree holder objected on the ground that section 46 of the Income -tax Act, 1922, required that the recovery should be made through the Collector and, in present case, as the demand had been made directly by the Income -tax Officer concerned it could not be entertained. The District Judge found as a fact that the claim for income -tax against the four partners of the firm far exceeded the amount lying in deposit in the court to the credit of the parties to the suit and that there was no allegation or suggestion by any party that the income -tax assessment was under appeal or likely to be reduced. The learned District Judge rejected the contention holding that the normal procedure was that the income -tax dues were to be realised as arrears of land revenue through the Collector, vide section 46(2) of the Income -tax Act, but in view of section 46(5A) it was open to the Income -tax Officer not to proceed through the Collector but to serve the court with a written notice to pay the money lying in deposit in court into the Government Treasury. In the result he directed the amount lying in despite with the request made by the Income -tax Officer. Hence this revision.
(3.) MR . Jagdish Swarup, learned Counsel for the petitioner, has contended, firstly, that the provisions of section 46(5A) have no application as the court is not a person to whom the Income -tax Officer can issue a notice under sub -section (5A) of section 46. Secondly, that the provisions of the Explanation to section 46(7) referred to any other law for the time being in force relating to the recovery of debts due to the Government and there was, according to him, no other law in force other than that provided in section 46 and as such a mere application to a court to pay the amount of the assessee lying with it was invalid and, lastly, that the Government had, after the coming into force of the Constitution of India, no priority in respect of its debts and unless the Government obtained a decree the provisions of Order 21 of the Civil Procedure Code could not come into play.;